Group A
Brief Answer Questions
Attempt all questions.
What is meant by wealth maximization goal of a firm?
[2 marks]
What are the major limitations of ratio analysis?
[2 marks]
How do you calculate value of a zero coupon bond?
[2 marks]
A stock has required rate of return 12 percent, a beta of 1.5 and the expected return on the market is 10 percent. What must the risk-free rate be?
[2 marks]
What is the present value of Rs 100,000 due in year 6, discounted at 12 percent?
[2 marks]
How do you compute profitability index and take investment decision based on profitability index?
[2 marks]
A company's fixed operating costs are Rs. 800,000, its variable costs are Rs. 30 per unit, and the product's sales price is Rs. 70. What is the company's operating break-even point?
[2 marks]
Write the meaning of capital structure.
[2 marks]
How do you determine EOQ using equation? Illustrate.
[2 marks]
Current market price per share of Sahara Company is Rs. 300. If company declares 20 percent stock dividend, calculate adjusted market price per share after stock dividend.
[2 marks]